Tractor sales steady in October

Sales of tractors of between 100-200 horsepower are 8 per cent higher than they were last year

Tractor sales nation-wide steadied with a slight recovery in October following a dramatic downturn in September, the Tractor & Machinery Association of Australia (TMA) says.

TMA executive director Gary Northover says the steadying was partly due to ‘end of year financial planning’ from some manufacturers which may have overinflated the position a little.

Overall, tractor sales were down around 2.5 per cent compared to last October and are now broadly in line with last year on a year to date (YTD) basis.

Queensland and WA recorded slight improvements, up around 1 per cent each for the month – with WA up a healthy 8 per cent on last year, and Queensland still trailing, down 3.5 per cent YTD.

Victorian sales continue to track last year while the bumper years in Tasmania (up 8 per cent), South Australia (up 10 per cent) and Northern Territory (up 8 per cent) round out the story.

The most drought affected regions of NSW continue to be hard hit, with sales this month down another 13 per cent, which puts the state’s sales at 8 per cent behind where they were last year.

Of the tractor types, large tractor sales were the order of the day for October, with sales up 14 per cent for the month in the 100-200 horsepower category – putting sales at 8 per cent ahead of last year.

This segment, normally associated with row cropping, has been strong for some time now and reflects the healthy state of our vegetable, horticulture and viticulture segments nationwide, Northover says.

Sales of tractors over 200hp were 26 per cent month on month, partially impacted by the aforementioned EOFY activity, and have made up ground to now be only 7 per cent behind YTD.

Northover says we are beginning to see signs of abatement in demand for large tractors, generally used in broadacre farming, due to consolidation in large broadacre operations and to changing climatic conditions.

"Ultimately, owners of this size range demand an adequate return on their investment and we expect to see greater emphasis on machine utilisation before the next buying cycle resumes," he says.

Activity in the small size ranges has been reasonably hard hit, with the under 40 hp segment in particular down 10 per cent for the month and 7 per cent YTD.

Northover says a degree of caution is now being applied in light of the pending election cycle and share market volatility, as the segment he calls the "leisure market" often tracks domestic economic sentiment.

There were 233 combine harvesters delivered in October which was down on last year’s level. The expectation is that this will be about as good as it gets for harvesters this year as suppliers begin to look towards sales programs for 2019.

Bailer sales have made a recovery off what was a cyclical low and are now 13 per cent up on last year and once again Out Front Mowers were slow, down 27 per cent for the month and now 14 per cent behind last year.